Business & Economy

Google Fiber pulls plug on negotiations for northwestern Vermont broadband network

A shipment of fiber optic cable is delivered to the Washington Electric Co-op in East Montpelier on April 21. Two communications union districts serving northwestern Vermont no longer plan to jointly build and operate an “open access” fiber broadband network in the region. File photo by Glenn Russell/VTDigger

Two communications union districts serving northwestern Vermont no longer plan to jointly build and operate an “open access” fiber broadband network in the region. 

The plan fell apart after Google Fiber pulled the plug last week on negotiations that were near completion for it to become the proposed network’s first internet service provider. In doing so, it cited a lack of confidence in the ability of Lamoille FiberNet — one of the districts — to carry out the project.

The proposed partnership was heralded as a major step toward expanding broadband access in communities with some of the least access to reliable, high-speed internet in the state. 

Sean Kio, executive director of Northwest Fiberworx — which covers just under 30,000 addresses across Franklin, Grand Isle and Chittenden counties — detailed the situation in an Aug. 17 letter to the organization’s governing board that was obtained by VTDigger. 

He confirmed the details in an interview, saying that Northwest Fiberworx still wants to build, own and maintain an open access network in the three counties it serves.

But without the addition of the roughly 14,000 addresses in neighboring Lamoille County covered by Lamoille FiberNet, no existing proposal has enough addresses to meet the 42,000 minimum required by Google Fiber, he said.

Open access networks provide infrastructure for multiple, competing internet service providers, rather than just one.

Kio wrote in the letter that a consultant hired by Lamoille FiberNet conducted a review of the organization's plans for the Google Fiber partnership on Aug. 1, and found that initial cost assumptions provided by a previous consultant were no longer viable. 

The organization also was concerned that a proposed agreement with Google Fiber was “onerous and unrealistic,” he wrote, and that it wasn’t currently possible for the district to reach all of the addresses it needed to.

“They went through and did some additional validation and discovered that, ultimately, they were going to have some shortfalls both in capital expenses and operating expenses, on an annual basis,” Kio said in the Tuesday afternoon interview.

Citing those challenges, Lamoille FiberNet told Google Fiber Aug. 4 that it wanted to “break off” negotiations with the company — a day after the organization's board met for an emergency meeting, according to Kio’s letter. 

On Aug. 16, Kio wrote, Google Fiber told him negotiations had ended due to a “lack of confidence that Lamoille FiberNet would have (the) ability to execute,” as well as the inability of Northwest Fiberworx to serve enough addresses on its own. 

Val Davis, executive director of Lamoille FiberNet, declined to answer questions about the Google Fiber negotiations or his organization’s future plans when reached by phone Tuesday. Davis said he could not speak on the record until after Lamoille FiberNet’s governing board meets on Wednesday to discuss the situation.

Kio noted in his letter that Northwest Fiberworx reviewed its own financial model for the project after hearing from Lamoille FiberNet, and did not find any issues. He maintained Northwest Fiberworx is not looking to place blame on Lamoille FiberNet, noting that either district could have discovered previously unexpected issues.

Lamoille FiberNet’s findings came later in the negotiation process than Kio would have liked, he said, but after the news broke, Google Fiber’s decision was not a surprise.

While Kio suggested Tuesday that his district may still collaborate in a “generalized” way with Lamoille FiberNet, his letter recommended against continuing to pursue a joint network. “It is not in NW’s best interest to continue our collaborative relationship with Lamoille CUD,” Kio wrote. “While we were optimistic, tying our success to another CUD comes with great risk.”

‘A bump in the road’

The districts had been in talks with Google Fiber since last fall about becoming the first internet service provider for the planned, open-access network. Google Fiber currently serves about 20 metro areas across the U.S., covering both rural and urban regions. 

According to a report on the project from the Vermont Community Broadband Board, Google Fiber had said it would charge $70 a month for 1 gigabit per second internet speed, and $100 a month for twice as much speed (1 gigabit is equal to 1,000 megabits).

For reference, the federal government’s minimum standard for broadband internet is 25 megabit per second downloads, and 3 mbps uploads.

Kio said the two districts were close to signing an agreement with Google Fiber, but nothing had been made official. 

After Google Fiber’s decision Aug. 16, Northwest Fiberworx’s board voted to draft a new memorandum of understanding with Lamoille FiberNet that will no longer tie the organizations' operations together, according to Kio.

Rob Fish, deputy director of the state’s Community Broadband Board, said Tuesday the organization was “disappointed, just as anybody would be” that Google Fiber has pulled out of negotiations with the two communications union districts, noting that the company was slated to provide a good deal to customers in the region.

Still, he sounded a confident note, saying it’s positive that the districts scrutinized their financing models, especially since they are slated to receive tens of millions of dollars in state funding to expand broadband access. 

“This is a bump in the road,” Fish said. “But I’d rather it be a bump than a pothole.”

Asked if Google Fiber’s decision was a setback for Northwest Fiberworx, Kio replied, “yes and no.” He said the organization plans to start looking for a new internet service provider to replace Google Fiber as the first company on its planned network.

“Google as an ISP provided a lot of alignment in what we were seeking, and our ideals,” he said. “But that does not mean there's not somebody out there who can provide a similar set of ideals, or a lot more alignment.”

Google’s press office did not respond to a request for comment Tuesday.

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Shaun Robinson

About Shaun

Shaun Robinson is a Report for America corps member with a special focus on issues of importance to Franklin and Grand Isle counties. He is a journalism graduate of Boston University, with a minor in political science. His work has appeared in the Boston Globe, the Patriot Ledger of Quincy and the Cape Cod Times.

Email: [email protected]

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